“HP in an SEC filing late Thursday outlined the payments for incoming CEO Meg Whitman and recently fired CEO Leo Apotheker,” Electronista reports. “Hoping to tie Whitman’s pay to performance, the company is emulating former chief Steve Jobs’ model and paying her a base $1 per year. While she will get a company-standard $2.4 million bonus every year, her real pay will depend on how much HP’s share value has grown over time.”
“She will have the option of buying as many as 1.9 million stock options, but these will vest over eight years and will only reach their peak value if HP’s stock value rises at least 40 percent,” Electronista reports. “At current values, they would be worth $45.2 million… Although it was never in question with Jobs, Whitman’s severance package is just $1.50 and discourages her from quitting for another firm.”
Electronista reports, “Apotheker, meanwhile, is being paid a large amount to reduce the ill will from his forced departure. He will be paid $7.2 million in core severance over the course of 1.5 years and will also be given a quickly accelerated $3.56 million stock cash-in. Along with the $2.4 million bonus and expenses to move back to Europe, the CEO should be paid about $13.5 million.”
Read more in the full article here.
HP will be lucky if they get even $1 benefit out of having Ms. eBay on board.
I’ll use this metaphor to construct what I mean in the least amount of words.
TouchPad ≠ iPad.
Shipped ≠ sold.
Meg Whitman ≠ Steven P. Jobs.
$1 ≠ $1.
How come a dollar isn’t equal to another dollar you may well ask. Because Whitman’s only worth a couple of cents to Steve-O’s dollar. In other words Meg’s only worth 2% of Steve’s value.
They should pay her 2 cents instead. That’s my 2 cents anyway.
It sounds to me like you’re saying that $1 spent on Steve Jobs, will get you far better results than $1 spent on Meg Whitman. I couldn’t agree more. However, I believe those of us who have relationships with Apple (be it consumer, employee, partner, or investor) are spoiled now. The chairman formally known as C.E.O. Steve Jobs isn’t one who’ll be emulated anytime soon. I believe Tim Cook will do a good job, but not quite in the manner that Steve performed. To actually BUILD your dream based on the belief that you can promote improvement is huge feat. To be immensely successful at it requires the kind of genius (both creative and technical in this case) that makes one a true ARTIST. Not everyone is an artist…………not in the complete sense of the word. I can throw bologna (or “baloney” for some) at a canvas, but it doesn’t make me an artist.
What I’m saying essentially is there only appears to be a veneer of verisimilitude of Steve Job’s compensation package that’s only obvious on the surface but if you dig deeper it seems to be a facade for HP to say, “Look after all these troubles we’ve had with Apotheker running the company, Whitman will come in and act like Steve Jobs and be our savior in fundamentally changing the company and in so doing write the second chapter of HP’s storied history.”
That seems to be the message anyway. But there the similarity stops because no matter what there will not a second act to the HP slide to irrelevance. Whitman will turn out to be very much like any run of the mill CEO and parachute out like Apotheker did with $23 million in the bank. She hasn’t got Steve Job’s chops for merging design and technology and her managerial history shows it.
Agreed. Also, the key thing is Meg will be focussed on the stock price, or “shareholder value.”
Jobs and company don’t give a fsck about the stock price, and don’t care about the shareholders. Seriously – they couldn’t care less about the owners of the stock. Ever notice they NEVER talk about the shareholders? They talk about CUSTOMERS and PRODUCTS and THE FUTURE.
And THAT’s why I’m a shareholder – the team’s focus is on the right things.
Just one more thing Apple has changed for the good! CEO pay based on performance!
I wish her and HP well!
HP seems confused on their pay terms:
If she gets a $2.4 Million “bonus” ever year, regardless of performance, then in actuality that is her base pay.
Her “real pay” that is based on performance is actually the bonus.
Correct. Her pay is 2,400,001.00.
What a joke all these compensation programs have become. The poor fuck who got fired because of upper managements poor vision and direction, was probably lucky to get a month’s salary for every year of employment and maybe got health insurance covered for six months. The top dude. who has worked there for less than a year, gets millions. What a screwed up situation this has become.
Then the double talk on Whitman’s compensation – as I see it she is getting $2.4M per year plus $1. She is not getting only a $1 per year! Other than some numb brain headline writers, who do they think they are fooling?
Bravo. O my. A mere 1$ plus 2.4 million. I she doesn’t turn the place around she’ll be in the poor house, with only 6X the salary of the average cardiothoracic surgeon. We are clearly reforming our exec pay.
I believe Apotheker walks of with an additional $10M on top of the $13.2M severance as part of his sign-on deal.
Where’s the outrage?
2.4 million dollar bonus if she is terrible. Merely the combined salary of 6 cardiothoracic surgeons. How will she stay out of poverty? We are clearly on the path to reform of executive pay in the country!
I don’t like executive pay rates/golden parachutes- But quite honestly, people ought to mind their own business and stop promoting class warfare.
It ain’t my business if HP wants to run itself into the ground, and unless you’re an employee/shareholder, it ain’t none of yours.
Envy is an ugly thing, and those promoting it are ugly little people
Oh my. Class warfare. Corporate executives compensation has skyrocketed in this country while corporate America has exported labor jobs to China as fast as possible. Criticizing this >fact< is class warfare. If you hold a 401K, you are probably a shareholder of HP and other companies greasing their greedy execs, so that problem is solved. OOOh Ooooh. Don't criticize the gilded elite that are paying 15% CG rates on their oversized stock packages. Oooh, don't criticize the job creators, who despite the lowest tax rates in generations have not created US jobs. Go find something like social security benefits, or public radio, or extension of unemployment benefits, or WIK, or food stamps to criticize or else you are an ugly little person. Cough, Bullsh!t.
Leave Corp. America alone. They are job creators according to the GOP and Fox news.
“Apotheker, meanwhile, is being paid a large amount to reduce the ill will from his forced departure”
REDUCE ILL WILL?? The guy was a moron who was forced out and they’re concerned about hurting his feelings??
Tell you what, if I ever get laid off or fired, given a box for my belongings and then escorted out by security, I would happily settle for a mere $100,000 to cover any possible ill will.
Oh wait, this practice only applies to overpaid executives?
No it’s not Jobsian at all.
Jobs doesn’t get a ‘standard’ 2.4 m bonus .
And jobs hasn’t got stock options since 2003.
Jobs hasn’t sold a single share of apple stock since his return to apple.
to really ’emulate’ Jobs pay : $1, no bonus, no stock i.e work for free. And don’t sell any shares you own. Lets see Meg line up for that.
(and don’t say Jobs can do what he does because he’s rich, Meg is rich from eBay etc as well).